The South Carolina Bar has proposed amending Rule 1.15(f), RPC, Rule 407, SCACR, to replace the terms “depository bank” and “bank” with the term “depository institution.” The Bar also proposes amending Rule 1.0, RPC, Rule 407, SCACR, to provide a definition of the term “depository institution.” The amendment takes into account the fact that a lawyer may receive funds from, or deposit funds into, a financial institution which does not meet the definition of a traditional bank. These institutions include a traditional bank, credit union, or savings and loan association. These institutions also must be insured by the Federal Deposit Insurance Commission in the case of a bank or savings and loan, or the National Credit Union Share Insurance Fund in the case of a credit union.

Pursuant to Article V, § 4, of the South Carolina Constitution, we hereby amend the South Carolina Appellate Court Rules as set forth in the attachment to this Order. Additionally, Rule 412, SCACR, concerning Interest on Lawyer Trust Accounts, contains a similar clause, but fails to note that a credit union is insured by the National Credit Union Share Insurance Fund. Accordingly, Rule 412(a)(4) is also amended to reflect the correct nomenclature of the insuring entity for a credit union.

This order is effective immediately.

IT IS SO ORDERED.

s/Jean H. Toal C.J.

s/John H. Waller, Jr. J.

s/Costa M. Pleicones J.

s/Donald W. Beatty J.

s/John W. Kittredge J.

Columbia, South Carolina
February 19, 2009

RULE 1.0: TERMINOLOGY

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(d) “Depository institution” means any bank, credit union or savings and loan association authorized by federal or state laws to do business in South Carolina and insured by the Federal Deposit Insurance Corporation, the National Credit Union Share Insurance Fund, or any successor insurance corporation(s) established by federal or state law.

(e) “Firm” or “law firm” denotes a lawyer or lawyers in a law partnership, professional corporation, sole proprietorship or other association, or in a legal services organization; lawyers employed in the legal department of a corporation, government, or other organization; and lawyers associated with an enterprise who represent clients within the scope of that association.

(f) “Fraud” or “fraudulent” denotes conduct that is fraudulent under the substantive or procedural law of the applicable jurisdiction or which has a purpose to deceive.

(g) “Informed consent” denotes the agreement by a person to a proposed course of conduct after the lawyer has communicated reasonably adequate information and explanation about the material risks of and reasonably available alternatives to the proposed course of conduct.

(h) “Knowingly,” “known,” or “knows” denotes actual knowledge of the fact in question. A person's knowledge may be inferred from circumstances.

(i) “Partner” denotes a member of a partnership, a shareholder in a law firm organized as a professional corporation, or a member of an association authorized to practice law.

(j) “Reasonable” or “reasonably” when used in relation to conduct by a lawyer denotes the conduct of a reasonably prudent and competent lawyer.

(k) “Reasonable belief” or “reasonably believes” when used in reference to a lawyer denotes that the lawyer believes the matter in question and that the circumstances are such that the belief is reasonable.

(l) “Reasonably should know” when used in reference to a lawyer denotes that a lawyer of reasonable prudence and competence would ascertain the matter in question.

(m) “Screened” denotes the isolation of a lawyer from any participation in a matter through the timely imposition of procedures within a firm that are reasonably adequate under the circumstances to protect information that the isolated lawyer is obligated to protect under these Rules or other law.

(n) “Substantial” when used in reference to degree or extent denotes a material matter of clear and weighty importance.

(o) “Tribunal” denotes a court, an arbitrator in a binding arbitration proceeding, or a legislative body, administrative agency or other body acting in an adjudicative capacity. A legislative body, administrative agency or other body acts in an adjudicative capacity when a neutral official, after the presentation of evidence or legal argument by a party or parties, will render a binding legal judgment directly affecting a party's interests in a particular matter.

(p) “Writing” or “written” denotes a tangible or electronic record of a communication or representation, including handwriting, typewriting, printing, photostating, photography, audio or videorecording and e-mail. A “signed” writing includes an electronic sound, symbol or process attached to or logically associated with a writing and executed or adopted by a person with the intent to sign the writing.

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RULE 1.15: SAFEKEEPING PROPERTY

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(f) A lawyer shall not disburse funds from an account containing the funds of more than one client or third person unless the funds to be disbursed have been deposited in the account and are collected funds; provided, however, a lawyer may treat as equivalent to collected funds cash, verified and documented electronic fund transfers, or other deposits treated by the depository institution as equivalent to cash, properly endorsed government checks, certified checks, cashiers checks or other checks drawn by a depository institution, and any other instrument payable at or through a depository institution, if the amount of such other instrument does not exceed $5,000 and the lawyer has reasonable and prudent belief that the deposit of such other instrument will be collected promptly. If the actual collection of deposits treated as the equivalent of collected funds does not occur, the lawyer shall, as soon as practical but in no event more than five working days after notice of noncollection, deposit replacement funds in the account.

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RULE 412
INTEREST ON LAWYER TRUST ACCOUNTS (IOLTA)

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(a) Definitions. As used herein, the term:

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(4) “Participating Institution” means any bank, credit union or savings and loan association authorized by federal or state laws to do business in South Carolina and insured by the Federal Deposit Insurance Corporation, the National Credit Union Share Insurance Fund, or any successor insurance corporation(s) established by federal or state law.